3 September 2026
Executive Summary
The disruption surrounding the Strait of Hormuz is forcing energy companies to adopt extraordinary logistics arrangements that demonstrate how profoundly the conflict is changing Gulf supply chains.
Three LNG cargoes loaded in Qatar and the United Arab Emirates have recently been transferred between ships outside the Strait of Hormuz for onward delivery to India and Japan.
The transfers took place in international waters outside the Strait.
Ship-to-ship transfer is particularly significant for LNG.
Liquefied natural gas requires specialist vessels, carefully controlled handling procedures and highly coordinated loading and discharge operations.
Moving Gulf LNG through additional offshore transfers therefore represents much more than a simple shipping diversion.
It demonstrates that businesses are developing alternative operational structures to overcome continuing disruption to one of the world’s most important maritime chokepoints.
Normal Hormuz traffic also remains severely depressed.
Recent vessel-tracking data has shown commodity-vessel movements remaining in single digits and substantially below recent averages.
The risk is therefore evolving from temporary interruption towards prolonged operational adaptation.
UK Impact
The UK does not need to experience an actual physical shortage of gas or oil before the economic consequences become significant.
British companies may face exposure through:
- Higher LNG prices.
- Higher oil prices.
- Increased electricity costs.
- Shipping surcharges.
- Higher chartering costs.
- Increased marine insurance costs.
- Petrochemical price increases.
- Manufacturing input inflation.
- Longer voyage times.
- Supplier force majeure.
- Contractual delivery delays.
Energy-intensive industries should be particularly alert.
Manufacturing, chemicals, glass, steel, food processing, transport and logistics businesses can experience material cost increases even where physical energy supplies remain available.
The relevant risk is therefore both availability and price.
Global Impact
The Strait of Hormuz remains one of the world’s most important energy corridors.
The development of ship-to-ship LNG transfers outside the Strait demonstrates that energy companies are beginning to engineer around the disruption rather than simply waiting for normal traffic to resume.
That has broader consequences.
Every additional operational stage can introduce:
- Additional cost.
- Additional contractual interfaces.
- Additional handling risk.
- Additional scheduling risk.
- Additional insurance considerations.
- Additional pollution exposure.
- Additional custody questions.
The physical cargo may remain exactly the same.
The risk architecture surrounding it does not.
This is particularly important where buyers assume their contractual exposure ends simply because a supplier has found another way of delivering the cargo.
Our View
Businesses should now stress-test their Gulf exposure against prolonged Hormuz disruption rather than temporary closure.
Companies should ask:
- Which suppliers ultimately depend upon Hormuz?
- Which energy contracts contain force-majeure provisions?
- Can suppliers use alternative ports?
- Are alternative ports genuinely accessible without Hormuz?
- Can cargo be transferred ship-to-ship?
- Who assumes risk during that transfer?
- Does cargo insurance remain effective throughout?
- Who carries contamination risk?
- Who carries pollution liability?
- Who pays additional chartering costs?
- Can delivery dates be extended?
- Are alternative suppliers dependent upon the same maritime corridor?
- What happens if extraordinary routing becomes normal for several months?
- How would a sustained increase in energy prices affect operating margins?
The key development is not simply that Hormuz traffic remains disrupted.
It is that global energy logistics are beginning to redesign themselves around that disruption.
That is potentially a much longer-term commercial risk.
Risk Indicator: SEVERE – ENERGY, SHIPPING & SUPPLY CHAIN
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The information contained within these Market Alerts is provided for general market awareness and informational purposes only. It does not constitute financial, legal, investment, regulatory or insurance advice. Whilst every effort has been made to ensure accuracy at the time of publication using multiple reputable and independently verified sources, geopolitical events, legislation, regulation and market conditions may change rapidly. Readers should obtain appropriate professional advice before acting upon any information contained herein.
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